Friday February 21, 2020


March 28, 2014

Modern China has seen unprecedented rates of urban growth. In the past 35 years, the population of its urban areas has grown by 500 million people, more than any other cities in the developed world during the early industrial era. China’s new middle class is concentrated in urban areas, and millions have come from the countryside to the cities for higher-paying employment. However, rapid urbanization has also created socio-economic tensions in China’s cities, leading Chinese officials to unveil China’s first modern urbanization plan to remedy existing problems, such as China’s residency identification system (hukou), overpopulation, and pollution.

Hukou System

At present, the proportion of urban residents to China’s total population stands at 53.7 percent. However, only 35.7% of China’s total population hold an urban hukou residency permit, demonstrating the large number of urban dwellers who are there illegally. As China’s economy shifted away from agriculture to industrialization, China’s rural residents came to the cities looking for jobs. Without a proper permit, it is very difficult and expensive for them to access public services, like education and healthcare, which are subsidized for certified urban residents – in effect creating a large group of ‘second-class citizens’. China’s new urbanization seeks to give urban residency status to 100 million migrant workers and raise the percentage of city dwellers with an urban hukou to 45% by 2020. This change will make city life fairer for some migrants, but it will still leave around 200 million without an urban hukou.

A comfortable life in the city has become the “China Dream” for many rural villagers. Urban hukou status affords it holders entitlement to better education, healthcare, and retirement benefits than are available in the countryside. The negative externalities of city life, like life-threatening air pollution, have not stemmed rural migrants’ large demand for urban employment and urban residency status. Thus, some Chinese feel let down that the government’s plan to extend urban hukou status will only meet less than half of the demand.

Urban Environment


In order to reduce the traffic congestion and dangerous levels of air pollution that have become a permanent feature in cities like Beijing and Shanghai, China will also invest in small and medium-sized cities to alleviate the problems associated with its major cities. The planned changes in the hukou registration system also reflect this strategy. Most new hukou permits will be distributed to cities with under 5 million people. China’s 16 cities with a population over 5 million can still give out hukou permits, but only through a points-system that gives preference to educated, skilled workers.

A rumor has also spread through internet news and social media platforms that the national government will follow suit to in giving preference to smaller cities by moving several government offices from Beijing to the city of Baoding, two and half hours southwest of Beijing. Moving offices to Baoding would be a critical step in integrating the metropolises of Beijing and nearby Tianjin and relieving the stress that overpopulation has put on transportation systems and housing markets in Beijing. However, the National Development and Reform Commission has denied the report.


Smart urban planning will require coordination from all levels of government. Although the national-level CCP Central Committee mandated the 2014-2020 urbanization plan, local government officials will have the greatest responsibility for overseeing the implementation of its components. This means the ranks of China’s leadership in Beijing will have to relinquish greater control to local and provincial officials throughout the nation, since this strategy calls for more emphasis on a greater number small and medium-sized cities, rather than concentrating on further empowering China’s mega-cities. In the past, China’s central leaders have been reluctant to grant more authority to lesser officials because 1) As local officials oversee greater government spending in cities, this can create opportunities for corruption as officials can use urbanization as pretext for overzealous use of eminent domain rights, amd 2) more significantly, Beijing has always been fearful of giving greater control to local officials, lest they become local strongmen who make a grab for power at higher levels in the fashion of the notorious Bo Xilai in Chongqing.

For more information about China’s urbanization strategy, please see the following news sources and commentary:

The Diplomat “Urbanization and Hukou Reform” ; “The Politics of China’s Urbanization”

The Economist“China’s Cities: The Great Transition”“Urbanisation: Moving On Up”

Tea Leaf Nation“A Capital Idea”

Wall Street Journal“Dashing the China Dream”

Wall Street Journal“Fighting to Breathe”

Xinhua“China unveils landmark urbanization plan”

For Chinese language news on this topic, please see below:

Caijing“拜尔:中国要想实现可持续城镇化 必须取消户籍制度”; “世行:城镇化是中国经济再平衡的关键”

China News – “国家发改委副主任:城镇化欢迎国际企业机构参与”

Reuters ” 财经洞察:中国力推的新型城镇化到底谁是主角?”



This post was compiled and edited by Amanda Conklin.